Trump Org says it donated $151,470 in profits to US Treasury

By TAMI ABDOLLAH and STEPHEN BRAUNMarch 9, 2018

FILE - The Trump International Hotel at 1100 Pennsylvania Avenue NW, is seen Wednesday, Dec. 21, 2016 in Washington. A Trump Organization executive says the company has donated $151,470 in foreign government profits at its hotels and similar businesses in 2017 to the U.S. Treasury. (AP Photo/Alex Brandon, File)

WASHINGTON (AP) — The Trump Organization has donated $151,470 in foreign government profits at its hotels and similar businesses last year to the U.S. Treasury, an executive said in a statement Friday.

George Sorial, the executive vice president and chief compliance counsel, said the Feb. 22 voluntary donation fulfills the company’s pledge to donate profits from foreign government patronage while Donald Trump is president.

The company said last week that it had made a donation but refused to disclose the amount or provide any other details, including how the figure was calculated and which foreign governments were involved. The Daily Mail first reported the figure on Friday. And while the U.S. Treasury has confirmed receipt of the check, it also did not provide any details. A representative for the Treasury declined to comment.

The amount spent at the Trump-owned commercial properties became an issue of debate on social media as media organizations and watchdogs filed public records requests with the U.S. Treasury and lawmakers demanded answers. Ethics experts have challenged the methodology by which the Trump Organization determines its profits as incomplete and misleading.

“They could have paid 10 times more or 100 times more, and we would equally have no way to judge whether the amount paid reflects their actual profits or how they calculated it, and which governments have been patronizing Trump properties,” said Robert Weissman, president of Public Citizen.

Earlier this year, Public Citizen found that foreign government advocacy groups were among the most high-profile interests using Trump properties dating back to the 2016 election.

Although few records are available showing amounts spent by Trump Organization clients, Justice Department foreign agent records revealed that a public relations firm working with the Saudi government spent $270,000 for lodging and catering at the Trump D.C. hotel sometime between Oct. 1, 2016 and March 31, 2017.

Malaysian Prime Minister Najib Razak and other Malay officials also stayed at the hotel last September during an official visit, but no figure was made available for the stay. And Kuwait’s ambassador booked the hotel for an undisclosed amount last February for an annual gala.

Two pro-Turkish organizations that work to aid business and political relations between the U.S. and Turkey also booked the Trump hotel last May for an undisclosed amount. One of the host groups, the Turkey-U.S. Business Council, was chaired at the time by Ekim Alptekin, a Turkish businessman who had hired Michael Flynn’s consulting firm in 2016 to perform lobbying and research. Fired by Trump after a brief stint as national security adviser, Flynn agreed late last year to aid the special counsel’s probe of Russian meddling into the 2016 election.

Ethics experts have criticized the pledge Trump made at a news conference held days before his inauguration because it didn’t include all his properties, such as his resorts, and left it up to Trump to define “profit.” The pledge was supposedly made to ameliorate the worry that Trump was violating the Constitution’s emoluments clause, which bans the president’s acceptance of foreign gifts and money without Congress’ permission.

Several lawsuits have challenged Trump’s ties to his business ventures and his refusal to divest from them. The suits allege that foreign governments’ use of Trump’s hotels and other properties violates the emoluments clause.

Trump’s attorneys have challenged the premise that a hotel room is an “emolument” but announced the pledge to “do more than what the Constitution requires” by donating foreign profits at the news conference.

As a privately held company, The Trump Organization isn’t required to disclose its definition of profit. In its statement Friday, it said made its calculation according to “our policy,” but didn’t say what that policy was. It also cited an accounting standard called the Uniform System of Accounts for the Lodging Industry, but that standard doesn’t provide a definition for profit, Hanson said.

In an eight-page pamphlet provided by the Trump Organization to the House Oversight Committee in May, the company provided more details. It said it would send the Treasury only profits obviously tied to foreign governments, and not ask guests questions about the source of their money because that would “impede upon personal privacy and diminish the guest experience of our brand.”

Public Citizen sent a letter to the Trump Organization last month because their methodology would seemingly not provide a donation from any unprofitable properties receiving foreign government revenue.

Sen. Ron Wyden, D-Ore., the ranking member of the U.S. Senate Committee on Finance, asked the Treasury in a letter sent Thursday to provide details on the payment, including a breakdown of how the payment was processed and whether any conditions were attached to it.

Hotel management professor Bjorn Hanson said there is no commonly accepted definition of profits in the industry. The widely varying definitions means some hotels can show big profits, while others show very little, even if they are doing equally well.

Some hotel companies, for instance, show lower profits than others because they subtract a host of costs — interest on loans and estimates of future expenses for replacing wallpaper and sheets — that others ignore.

“I teach hotel finance, and I tell my students, ‘Don’t ever use the term profit,’” said Hanson, professor of hospitality and tourism management at New York University. ”‘People won’t know what you mean.’”

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AP Writer Bernard Condon in New York contributed to this report. Follow Tami Abdollah on Twitter at https://twitter.com/latams